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Tax Notice Fervor at the IRS: What You Can Do to Make It Stop
"As of October 2, 2021, we (the IRS) had 6.8 million unprocessed individual returns." - IRS Newsroom
According to the House Ways and Means Committee Chairman, Richard Neal, the IRS had 12 million pieces of unopened mail during the summer of 2020. As the IRS still works through massive piles of mail and tax returns, 11 million taxpayers are receiving CP11 notices for unpaid balances related to stimulus payments, not including any other tax notice issues. Many taxpayers are receiving notices even after responding or writing a check to the IRS. Refunds that used to take 21 days are taking 120 days - per IRS operations reports. Richard Neal recognized that these notices can impose unnecessary stress and asked that the IRS halt sending notices. Still, the automated notices continue to be issued while responses and phone calls continue to be unanswered. Our team would like to help you understand what to do next.
"Paper returns have piled up — there are 5.5 million Form 1040s and over 4 million business returns that have been opened but not processed. The goal is that by year-end, the paper returns will be processed. However, there are an additional 4 million returns anticipated by mid-October." - Stephen Mankowski, Tax Chair of the National Conference of CPA Practitioners
Currently Butrica Ployd & Associates is doing everything we can to make this process easier for you. When you engage us to assist you with your notice, we will help you asses the problem and better understand how to resolve the issue. In addition, a member of our staff will prepare a response letter for you to send to the IRS. However, the IRS is overwhelmed with mail and our practitioner line is unreachable, so our assistance is limited to providing letters and helping you understand how to discuss the issue with an IRS agent.
In this moment, individuals have a 1 in 50 chance of reaching the IRS at 800-829-1040. Still, practitioners cannot reach the IRS at all. Your best first steps are to call the number provided on the letter and discussing the issue first with an agent yourself. Here a few more steps to take if you’ve received a Notice from the IRS.
What Can I Do About My Tax Notice?
Step 1 Read Carefully
Your notice or letter should explain the reason for issue and give you instructions on how to contact the IRS.
- If you find that the notice is accurate, the letter will include instructions for payment of the balance due.
- If your notice disagrees with your tax return, make sure to compare it with your tax return at www.Onvio.us. Also make sure to review the year referenced by the notice in the upper right heading.
- If you have trouble understanding the issue, review the notice name (which should start with CP). Searching this notice name online should give you some background on the issues other have experienced.
- If you are still unable to understand your issue, contact our team. Our notice review processed is slowed due to the many notices we are receiving. But, one of our accountants will review your notice and help you identify the cause of your issue.
Step 2 Respond
Respond by specific date to minimize additional penalty or interest + preserve your appeal rights. If you need help with your response, you can engage Butrica Ployd to provide more in-depth assistance.
- If you disagree with the IRS decision, contact the IRS at the number provided on the Notice or 800-829-0922. If the number is busy, try calling at other times; wait times will vary. Typically, you only need to contact IRS if you don’t agree with the information, if the IRS requested additional information, or if you have a balance due. You can also write to the IRS at the address in the notice or letter. If you write, allow at least 30 days for their response.
- Make sure to keep tracking of anything you send to the IRS as proof you tried to resolve these issues, including your tax notice and response letter.
For CP11 Notices related to Economic Impact Payments (Stimulus)
Most of these issues are caused from mismatches in the IRS system on payments sent to you versus what you reported on your tax form. This can be a result of unreceived payments by mail, missed deposits, or IRS error.
First, review your notice or your online IRS account to determine exactly what stimulus amounts the IRS says that you received. Compare that amount with your bank statements (around March to July of 2020 AND January of 2021). Then, contact the IRS in writing or call them at 800-829-0922.
If you agree with the IRS that what you reported to us was incorrect and upon looking back in your bank statement and you find that you did receive payments equaling what the IRS is reporting, then follow the instructions to pay the money back. Pay online or mail a check or money order with the attached payment stub. You can pay online now at www.irs.gov/payments.
If you disagree, you must contact the IRS within 60 days. Make sure that you review the notice instructions on page 2 of the notice.
If you want to check your online IRS account, follow these instructions:
- Go to www.IRS.gov
- Click on “View Your Account”
- Click on “Log into your account online”
- Click on “Create an Account” and follow the instructions if you do not have an account
- Click on “Log In” if you do have an account
- Once signed in: Click on the “Tax Records” tab at the top
- Now look for the 2020 Economic Impact Payment Information
- You will also see 2021 Economic Impact Payment Information (we will need this for your 2021 taxes)
Here at Butrica Ployd & Associates, we are doing our best to assist our clients in these issues. Unfortunately, even with the IRS being as behind as it is, sometimes the best course of action is to call the IRS directly. Policies and Notices are changing rapidly so confusion is understandable, and we will assist you the best way we can. Regarding the Economic Stimulus payments, calling the IRS at various points of day is the best course of action until you can speak with a representative. For other notices, we will assist you in identifying the problem and sending you the proper paperwork for you to send to the IRS.
"Once you’ve answered the notice, you don’t need to answer it again." - IRS Newsroom
While the IRS has indicated that no further action is necessary, they continue to send progressively more alarming tax notices while response letters go unprocessed. In this environment, you may need to contact the IRS any way possible - typically by sending a letter and calling each week until your reach an agent. If you do send a letter, request tracking and print a copy of the report once the package arrived.
